[News Space=Reporter seungwon lee] Harvard Business School students in the United States learned about and discussed the innovative growth case of Olive Young, a representative K-beauty channel.

CJ Olive Young (hereinafter referred to as Olive Young) announced on the 16th that a case study on Olive Young's competitiveness in contributing to the revitalization of the K-beauty industry ecosystem centered on small and medium-sized businesses by introducing the first multi-brand beauty & health channel in Korea was adopted as a textbook at Harvard Business School in the United States.

As Korea has emerged as the world's fourth largest cosmetics exporter, the business model and growth of K-beauty's representative distribution channel are interpreted as being evaluated as a meaningful management research case. The textbook was first released on the 11th (US time) at the management innovation class 'Innovation at Scale' for second-year MBA students.

An Olive Young official said, “About 30% of the students who participated in the class said they had experience with Olive Young, showing great interest,” and “On that day, the students looked into Olive Young’s core competencies and discussed ways to enter the U.S. market.”

This case study, titled 'Olive Young: Formulating Beauty Innovation,' focused primarily on Olive Young's role as a K-beauty 'incubator' that discovered and nurtured promising new brands and expanded the market.

Olive Young has contributed significantly to the formation of today's robust beauty ecosystem and the global K-beauty trend by creating a collaborative model with partners of various sizes and positioning itself as a channel that goes beyond introducing brands to consumers and suggests new trends.

It also mentioned that CJ Chairman Lee Jae-hyun’s management philosophy supported Olive Young’s market-leading role. The textbook introduced CJ’s ONLYONE spirit, which states that “each business must be a leader, the best, or provide unrivaled value,” and what Chairman Lee emphasized to Olive Young’s management: “Distributors must prioritize long-term partnerships based on mutual growth.”

The key secrets that allowed Olive Young to grow into a leader in the K-beauty industry were ▲MD work style ▲omnichannel ▲customer experience innovation.

Harvard Business School focused on the unique working methods of Olive Young MDs, who do not simply negotiate prices to decide on product placement, but rather solidify cooperative relationships by mobilizing Olive Young's infrastructure, including stores, online, and global channels, based on a strategy to grow the brand.

Harvard emphasized the difference from other channels, saying, “The role of Olive Young MD has expanded far beyond simple product sourcing to include work that leads the market by continuously ‘curating’ new trends based on collaboration with brands that have entered the store.”

In addition, the Olive Young MD Council, which discusses and evaluates key elements such as product differentiation points, price competitiveness, and trend potential before launching a new product, was seen as an important process that increases the possibility of a product's success.

Omni-channel, where 1,350 stores nationwide (as of the end of 2023) and the online platform are organically linked, was also analyzed as a key competitive edge of Olive Young.

Key examples introduced include analyzing customer behavior patterns in stores and reflecting them in online strategies, and using offline stores as downtown logistics warehouses to respond quickly to online orders.

It was also noted that bold investments in logistics and IT were made in parallel to strengthen the omnichannel strategy. In fact, Olive Young opened the Anseong Logistics Center targeting global markets and the Gyeongsan Logistics Center for non-metropolitan areas last year, and invested 14 billion won in building urban logistics hubs (MFCs). The size of digital and IT organizations to maximize customers’ digital experience has also grown significantly over the past five years.

The store management method that broke away from the industry standard of displaying by brand and introduced display centered on trends and categories, and where employees only provide assistance when customers ask, was also highlighted. The concept of ‘discovery shopping’ that allows customers to freely explore new products was evaluated as a key factor that made today’s customers feel that Olive Young is a ‘beauty playground’.

An official from Olive Young said, “We felt that interest in K-beauty was so high that we were the only category channel to be selected for a case study by Harvard Business School,” and added, “With the mindset that the growth of small and medium-sized brand names is the growth of Olive Young, we will serve as a growth booster to help small and medium-sized K-beauty brands continue to expand in the global market.”

Meanwhile, the Olive Young case study was co-written by Professor Rebecca A. Karp and Researcher Shu Lin of Harvard Business School, and will be published in the Harvard Business Review, a monthly business magazine owned by Harvard Business School, and will be utilized in various ways. Olive Young is also considering implementing additional K-beauty-related programs in collaboration with Harvard Business School this year.